Fate of US Steel’s deal with Japan’s Nippon is now up to Biden, sources say | CNN Business

CNN - Dec 24th, 2024
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A committee of top government officials has informed President Joe Biden that it remains divided on whether Nippon Steel’s acquisition of US Steel presents a national security risk. This leaves Biden with the crucial decision-making power, and he is expected to block the sale, emphasizing the need to maintain US Steel under American ownership to safeguard domestic jobs. The Committee for Foreign Investment in the United States (CFIUS), which typically advises the president based on its findings, has been unable to reach a consensus. The committee's deadlock highlights the political sensitivities surrounding the deal, especially with public opposition from Biden, Vice President Kamala Harris, and President-elect Donald Trump. Meanwhile, stocks of US Steel dropped by 3% in afterhours trading following the committee's notification to the president. The sale was initially agreed upon a year ago for a price significantly higher than a previous offer from Cleveland Cliffs, a US-based company. Nippon Steel has committed to investing billions into US Steel's operations in key states to win approval for the deal. However, the transaction has become highly contentious, with politicians and stakeholders on both sides expressing concerns over the future of American manufacturing. US Steel argues that the merger is crucial to its survival amid competitive pressures from cheaper foreign steel imports, primarily from China. Despite the potential benefits, the deal also faces scrutiny from the US Justice Department on antitrust grounds. With President-elect Trump having declared his intent to block the deal, the future of US Steel's ownership remains uncertain, influencing broader discussions on trade, jobs, and national security.

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RATING

7.0
Fair Story
Consider it well-founded

The article provides a detailed and informative account of the ongoing deliberations over the potential sale of US Steel to Nippon Steel. It highlights the internal conflicts within the Committee for Foreign Investment in the United States (CFIUS) and the broader political implications of the deal. The article excels in clarity, offering a straightforward narrative structure and maintaining a professional tone. However, it falls short in terms of source quality, as it relies heavily on unnamed sources without sufficient attribution. Moreover, while the article provides a relatively balanced view of the situation, it could benefit from a more diverse range of perspectives, particularly from stakeholders like union representatives and economic analysts. Overall, the article is a valuable piece for understanding the complexities of the issue but does require improvements in sourcing and balance.

RATING DETAILS

8
Accuracy

The article demonstrates a high level of factual accuracy, as it outlines the complex situation regarding the potential sale of US Steel to Nippon Steel. It accurately reports the deadlock within CFIUS and the political opposition from key figures like President Joe Biden and President-elect Donald Trump. The article mentions specific financial details, such as Nippon's pledge to invest $2.7 billion in US Steel's mills, which aligns with previous reports on the deal. However, there are areas where the article could improve in verifying claims, such as the precise reasons behind the deadlock within CFIUS. Additionally, while it notes the involvement of the US Justice Department in an antitrust review, it does not provide specific details on the nature of this review, leaving room for further verification.

6
Balance

The article provides a moderately balanced perspective on the issue, acknowledging both the political and economic dimensions of the proposed deal. It fairly presents the positions of US Steel and Nippon, noting their insistence that the deal poses no national security threat. However, the article primarily focuses on the political opposition from US leaders, without giving equal weight to other perspectives, such as those from labor unions or economic analysts who might provide insights into the broader implications for the steel industry. Additionally, while the article mentions public opposition from Biden and Trump, it does not explore the specific arguments or evidence supporting their positions, which could provide a more nuanced view of the situation. Overall, the article could benefit from a wider range of viewpoints to present a more comprehensive picture.

9
Clarity

The article is well-structured and clear, with a logical flow that guides the reader through the unfolding story of the US Steel sale. It begins by establishing the current state of deliberations within CFIUS and then provides background on the political and economic stakes of the deal. The language is straightforward and professional, avoiding emotive or biased terms that might detract from the article's objectivity. Complex information, such as the financial details of Nippon's investment pledge, is presented in a manner that is easy to understand, contributing to the article's overall readability. One area for improvement could be the inclusion of more subheadings or bullet points to break down dense information, but this is a minor point in an otherwise clear and coherent piece.

5
Source quality

The article relies heavily on unnamed sources, which affects the transparency and credibility of its reporting. While it cites 'two sources familiar with the matter' for the claim that CFIUS has not reached a consensus, it does not provide specific attribution or details about these sources' roles or expertise. Moreover, the article references reporting from the Washington Post and CNN's Chris Isidore, but it does not include direct quotes or detailed information from these sources, limiting the reader's ability to independently verify the claims. The article would benefit from incorporating more authoritative and attributed sources, such as official statements from CFIUS or public comments from involved parties, to bolster its credibility and provide a fuller context for the reported events.

7
Transparency

The article demonstrates a reasonable level of transparency by outlining the key stakeholders and the processes involved in the decision-making regarding the US Steel sale. It identifies the role of CFIUS and the involvement of the US Justice Department in an antitrust review, providing context for the complexities of the situation. However, the article lacks in disclosing potential conflicts of interest or affiliations that may influence the perspectives of the sources or stakeholders mentioned. For instance, it does not explore the potential economic motivations behind Nippon's proposed investment or the political interests driving opposition from Biden and Trump. Greater transparency in these areas would enhance the reader's understanding of the underlying dynamics and motivations influencing the reported events.